GLOBAL MARKETS-Asia mood to be tested by Trump warning on China

A tentative rebound in global
share markets will be tested in Asia on Tuesday after U.S.
President Donald Trump quashed hopes he might strike a truce on
trade with China, dampening risk appetite across the region.

In an interview with The Wall Street Journal, Trump said he
expects to move ahead with raising tariffs on $200 billion in
Chinese imports to 25 percent from 10 percent currently.

Trump said it was "highly unlikely" he would accept China's
request to hold off on the increase.

The comments ran counter to recent speculation about a
possible deal when Trump meets with Chinese President Xi Jinping
at the G20 summit in Buenos Aires later this week.

"Trump's pessimistic view on the chances of a game-changing
China trade deal may puncture global equity markets' optimistic
start to the week," said Sean Callow, a senior FX analyst at
Westpac in Sydney. "Combined with last week's harsh report from
the U.S. trade representative, investors have only the flimsiest
hope that the Trump-Xi meeting in Argentina will amount to more
than a hill of soybeans."

The early reaction was limited to a drop in trade-sensitive
currencies, including the Australian dollar, with share
markets yet to open in Asia.

The U.S. dollar remained firm for the moment at 113.60 yen
, while the euro nursed losses at $1.1328.
That left the dollar a shade firmer at 97.089 against a
basket of currencies.

Shares in Apple Inc fell after-hours in reaction to
Trump's comments that tariffs could also be placed on laptops
and iPhones imported from China.

Trump's remarks came just as the mood among investors had
shown signs of brightening. Wall Street took heart from an
upbeat holiday shopping period.

European stocks also bounced on Monday, on talk that Italy
was preparing to rework spending plans that have fuelled
tensions with the European Union, though coalition leaders later
said the government was sticking to its main 2019 budget goals
as it awaits a full cost analysis of its most important spending
measures for next year. Even oil managed to regain
a little ground after the gut-wrenching slide of recent weeks.

The Dow ended Monday up 1.46 percent, while the S&P
500 gained 1.55 percent and the Nasdaq 2.06
percent.

The rally came after the S&P 500 on Friday recorded its
lowest close in six months, down more than 10 percent from
September's peaks, putting it in "correction" territory.

In commodity markets, oil prices climbed nearly 3 percent on
Monday in what was seen as largely a technical correction after
weeks of losses.

Brent crude futures rose $1.68 to $60.48 a barrel,
while U.S. crude gained $1.16 to $51.58 a barrel.

(Reporting by Wayne Cole
Editing by Leslie Adler)

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)